Revenue Tanks as Virtual Events Replace Peer-to-Peer Fundraising
The COVID-19 epidemic has caused nonprofits to shift from in-person, peer-to-peer fundraising — such as sponsored walks and bicycle rides — to virtual events. In many cases, funds raised from these events are well below what had been budgeted, according to research from the Peer-to-Peer Professional Forum.
According to a survey from the Rye, N.Y.-based organization, two-thirds of nonprofits in North America have already either replaced a planned in-person event with a virtual one or had added a virtual event to their schedule. Three-quarters were planning a virtual event during the remainder of 2020, with 28 percent creating at least one totally new event in addition to any program substitutions they had made. Only 4 percent reported being able to hold in-person events and 15 percent canceled an in-person event without holding a virtual replacement.
By and large, the events don’t generate as much revenue as their in-person counterparts. According to research from the Peer-to-Peer Professional Forum, a virtual take on the Atlanta-based Arthritis Foundation’s fundraising walks pulled in $3.5 million during spring 2020, well below the $8 million it had budgeted for the in-person event.
“With many nonprofit development teams struggling to make virtual fundraisers generate 50 percent of the contributions they had expected from physical walks, rides and other events they had planned before Covid-19 hit, it’s hard to see how the pandemic has been anything more than an unmitigated disaster for peer-to-peer fundraising,” David Hessekiel, president of the Peer-to-Peer Professional Forum, wrote in a Forbes.com blog post.
There are a few bright spots. In his blog post, Hessekiel found some organizations were able to expand their efforts, bringing a global reach to local events. A virtual Alzheimer’s Association event was joined by people throughout Europe, who otherwise would not have made the trip to Fort Collins, Colo., for the live event. And cystic fibrosis patients, whose immunocompromised nature usually prevents them from participating in the Cystic Fibrosis Foundation’s Great Strides fundraiser, were able to join the virtual event.
Occasionally there is a silver lining to hosting virtual events. While revenue may drop, the expenses associated with these events, assuming contracts for them aren’t already in place, can fall as well. While the March of Dimes raised only $25 million during its spring event, compared with $48.9 million a year ago, the net contribution to the Arlington, Va.-based organization was more than last year because of a reduction in operating expenses, according to Hessekiel.